Federal Judge Scraps City Pension Overhaul

A federal judge ruled Thursday that some of the recent changes made to fire and police pensions systems in Baltimore City were unconstitutional. The ruling could cause the City to pay tens of millions of dollars more to retirees each year, according to the Baltimore Sun.

The City Council passed the challenged overhaul to the pension system in 2010. The law changed retirement benefits in an effort to control the City’s annual contributions to the fire and police pension systems, which had increased by approximately 270% in ten years, as cited in the legislation. Additional information about the legislation, such as testimony from the City’ s Finance Department, is available here.

The judge found that the cost of living adjustments in the new law were unconstitutional and harmed younger retirees too severely. From the Sun,

U.S. District Judge Marvin J. Garbis held that the city’s decision to change the method for determining annual increases for retirees — resulting in less money for many — was “unconstitutional” and not “reasonable and necessary to serve an important public purpose.”

The City Solicitor, George Nilson, told the Sun that the City will likely be appealing the ruling.

Limited free views of the Baltimore Sun’s coverage are available online and the Baltimore Business Journal also provides a summary of the story.